NAR Members Refresh Board Structure

November 7, 2016

The NAR Delegate Body today approved minor changes to the composition of NAR’s board of directors, the first structural changes to that group since 2000.

Over those 17 years, the industry and the association have seen significant advances, and national membership has grown by 58 percent. In that context, NAR’s Leadership Team asked REALTORS® and association executives from across the country to take a comprehensive look at the composition of the Board of Directors.

NAR’s Leadership Team sought “to ensure that the Board of Directors continues to best represent NAR's diverse membership and our dynamic industry,” said 2016 NAR President Tom Salomone. Earlier this year, he appointed a presidential advisory group that reviewed the board structure, as laid out in the NAR Constitution. The PAG’s report, released in September, recommended amendments to specific board membership categories and, more controversially, changes to the way state and local association allocations to the board would be made.  Ultimately, the allocation changes were defeated by the Delegate Body.

The Delegate Body, a group composed of presidents of member boards (or their accredited alternates), must approve any changes to the NAR Constitution or Code of Ethics. Constitutional changes require a two-thirds majority. The group typically meets once a year at NAR’s annual conference.

The first set of recommendations, approved by the Delegate Body, focused on the requirements that specific positions serve as board representatives. Most of these recommendations go into effect Jan. 1, 2018:

  • Committee Liaisons. All committee liaisons will serve as representatives on the board. Why the change: Liaisons serve as a bridge between committees and the NAR Leadership Team and are meant to provide meaningful input. There are 15 committee liaisons in 2016, and the NAR constitution had limited the number of liaisons serving on the board to no more than seven.
  • Idea Exchange Council Chairs. Beginning in 2019, the chairs of NAR’s Local and State Idea Exchange Councils will no longer have a position as board representatives. Why the change: The Idea Exchange Councils are forums and, unlike committees, don’t make policy recommendations or motions. In addition, this category of membership is already represented on the board.
  • Franchises. National real estate franchises will no longer be a category of representation. This is a category that was added during the 2000 board restructuring. Why the change: The PAG report pointed out that NAR has no mechanism in place to determine the number of members within a franchise. In addition, national franchises are already represented through the large firm category.
  • Large firms. The 75 largest real estate firms will still have a representative, but now those companies can appoint a representative from within their management team. Previously, the representative had to be a principal, partner, or corporate officer. Why the change: It increases the likelihood that these large companies will be able to have a representative at Board meetings and allows for a broader pool of members to become involved in NAR.
  • Outside Organizations. The historically black National Association of Real Estate Brokers traditionally had a representative on the board. Under the changes, NAREB was removed as a stand-alone category, but a representative of NAREB will continue to be appointed within the Outside Organizations category. Why the change:  It was an affirmative effort to be more inclusive. Four of the 10 seats going to Outside Organizations will be devoted to representatives from the National Association of Real Estate Brokers, the National Association of Hispanic Real Estate Professionals, and the Asian Real Estate Association of America, and the LBGT community.

The Delegate Body rejected amendments to the state and local association entitlement formulas that would have decoupled state and local association allocations. The state and local allocation recommendations faced serious opposition leading up to the meetings. Executives from some large local associations expressed concern that they would lose votes to their state association and that diversity on the NAR Board would suffer. The intent of the presidential advisory group, on the contrary, was to encourage the states and locals to work together when determining directors.  Under the current rules, local directors are subtracted from the state's counts. Decoupling the state and local allocations would have given states more predictability when appointing directors.

"Today's decision reinforces the fact that the REALTOR® association is a member-driven organization,” says Vince Malta, a San Francisco REALTOR® who chaired the board structure PAG. “The active discussion and debate leading up to the Delegate Body vote is evidence of engagement at all levels of our association, and this involvement only makes us stronger as we move forward in a dynamic industry."

By Stacey Moncrieff, REALTOR® Magazine